Manufacturers are supporting a congressional vote that would ease their financial reporting requirements, calling the rules under the Congressional Review Act “overly burdensome” and especially in a global economy.
The National Association of Manufacturers says that such rules are extremely costly — monies that could otherwise be targeted to things like environmental technologies, pollution controls and additional production.
“The disclosures that public companies currently must file with the Securities and Exchange Commission are lengthy and burdensome, often overwhelming both the issuer and their shareholders,” writes Christina Crooks, who is the Director, Tax Policy for the National Association of Manufacturers. “In many cases, required disclosures are confusing and duplicative, as well as extremely costly for public companies to comply.”
She specifically points out that Dodd-Frank has already layered manufacturers with reporting requirements. Section 1504 of the Dodd-Frank Act requires resource extraction issuers to disclose publicly payments made to the U.S. federal government or foreign governments for the commercial development of oil, natural gas or minerals, she says.
“Unfortunately, this rule adds hundreds of millions of dollars to manufacturers’ compliance and reporting costs at a time when the regulatory burden is already significant,” Crooks notes. “Furthermore, since the rule only applies to companies listed with the SEC, it creates an uneven playing field and a potential competitive advantage for companies that do not have to file such reports with the SEC.”
If Congress votes to disapprove of Section 1504, she says that this is one step in the direction of eliminating “unnecessary and unworkable” reporting requirements. And if those rules are lifted, the manufacturers would then have more resources to comply with environmental regulations and to invest in modern technologies to reduce emissions.
And the resources could also go back into production. To that end, the US shale gas boom has put the American steel industry back in the business of making pipes for drilling rigs and new pipelines.
The steel industry’s resurrection has been punctuated by developments like U.S. steel titan Nucor Corp.’s $750 million investment in an iron-ore facility in St. James Parish, Louisiana. The company opened the facility in 2013 to strip oxygen from iron ore — an energy-intensive manufacturing process that in an earlier era had left the United States for global regions that could power the plants more cheaply. When fully operational, the plant will be one of the most productive steel-making facilities in the world, generating around 2.5 million tons per year.
The good fortune is compounded because developers are able to make use of both “dry” natural gas and the “wet gas” that is separated from it. Those so-called natural gas liquids are comprised of such chemicals as butane, ethane, methane and propane — all of which can serve as the foundation for finished goods that are consumed domestically and exported around the globe.